Federal officials have started making post-Hurricane Maria aid decisions affecting Puerto Rico and the U.S. Virgin Islands.

On Wednesday the U.S. Office of Management and Budget asked Congress to provide $12.77 billion in initial funding to recover from hurricanes Maria, Harvey, Irma. The money is to be used in Texas and Florida as well as the two territories. OMB Director Mick Mulvaney said that the federal government is spending nearly $200 million a day on post-hurricane assistance.

Jenniffer González Colón, Puerto Rico resident commissioner, presents Hurricane Maria's impact on Puerto Rico to Congress Wednesday.
Jenniffer González Colón, Puerto Rico resident commissioner, presents Hurricane Maria's impact on Puerto Rico to Congress Wednesday.

“Federal agencies are working diligently to collect the information that they need to generate thorough and well-justified cost estimates for the rebuilding efforts that will be required,” Mulvaney said, adding that this may take up to 90 days.

U.S. Senate Majority Leader Mitch McConnell released a statement regarding the supplemental funding request: “The Senate remains committed to doing its part to support relief efforts along with [Federal Emergency Management Agency], the Department of Defense, and the rest of the administration to help those in need.”

Members of Congress and territorial representatives at a workshop meeting Wednesday on federal help for the two territories agreed that “there must be a new vision of FEMA’s mandate, so that it should not be merely to restore what existed on the day of landfall as it was, but to cooperate with a reconstruction that is up to current standards and less vulnerable to future hazards,” according to a statement from Puerto Rico’s non-voting Congressional representative, Jenniffer González Colón.

On Tuesday liberal think tank Center for American Progress posted a policy piece also seeking changes in federal aid after hurricanes. In “Safe, Strong and Just Rebuilding after Hurricane Harvey, Irma, and Maria,” the center recommended that the governments adopt design guidelines for extreme weather, incentives to increase energy efficiency, and update FEMA flood maps, among other things.

Puerto Rico Resident Commissioner González Colón said that she expected that during the first week of December there would be further appropriations for the Atlantic territories beyond the $13 billion.

The government of the Virgin Islands said that the federal government had approved $35 million out of its $70 million request for power restoration, debris removal, and road clearance.

“The spending details of federal grants or loans is likely to be a point of controversy between the government and the [Puerto Rico Oversight] board in the coming years, as would the disposition of any hypothetical new loan proceeds made possible with a federal backstop or similar facility,” Municipal Market Analytics said in its Outlook Monday.

“Note that, to the extent Puerto Rico is given access to a new borrowing vehicle (as it might, considering Congressional Republicans’ growing interest in being seen as providing relief and to minimize the flow of migrants to Florida), repayments to such will almost surely subordinate all outstanding commonwealth bonds, further diluting current bondholder recovery,” MMA continued.

According to a Bloomberg News story, Puerto Rico Treasury Secretary Raúl Maldonado Gautier said that he expects Puerto Rico’s government to run out of money on Nov. 1 unless the federal government gives it money.

The government is using its cash now but is receiving little or no revenue, as the economy is barely operating and the government has suspended its sales and use tax. Maldonado Gautier said the local government would be seeking $6 billion to $8 billion in aid from Congress for continuing its operations.

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